Never sit back and admire what you’ve achieved – always look forward to what’s next. Innovation is progress and progress leads to further success, so don’t put a lid on your ideas and goals – however successful your current business. Continually evolve your offering, responding to clients’ needs and aspirations to keep clear water between you and your competitors. Regularly step back to view your business from your customers’ perspective and always seek to exceed their expectations.
In the early days, cashflow was a major issue for us and we felt like we were hitting brick walls, one after the other, in our search for a bank to allow us BACS and direct debit capabilities. We knew we needed them for the development and scalability of the business and were determined not to give up. We finally found a bank to say ‘yes’ when all the advice around us urged caution. If you believe in something and know it’s right for you – stick to your guns.
Any business is only as good as the people in it, so you need to get your recruitment right. Recruit on attitude not qualifications on a piece of paper; have fun together; introduce a strong culture of reward and recognition; and – importantly – pay more to attract the very best.
When we started out in 2000, a time when outsourcing was seen as the preserve of larger businesses, we were considered to be bucking the trend by providing our service almost exclusively to start-ups and small firms. At that time, for larger businesses to even think about outsourcing their telephone answering function was virtually unheard of, so we faced many sceptics.
Listen to your clients, communicate well and think about what you need to do to reach new markets. Pre-empt. Don’t be afraid to be different. Stand out, so that it’s easier for prospects to make a choice. Get your name out there; get people talking about you and build fantastic relationships. Don’t just concentrate on new acquisitions; look after the ones you already have, too.
As a business owner, I constantly remind myself of the age-old adage: “Turnover is vanity; profit is sanity; cash is reality.” At my start-up, whether we’re riding a wave or encountering a turbulent period in our growth, one question is always raised whenever a management meeting takes place: “How can we tighten our belt and cut out unnecessary expenditure?”. Here are my tips:
When starting out, be very modest with your workspace. Share space with other new and established businesses to keep your costs down. A shared workspace enables you to explore ways of sharing costs beyond rent. You can consider things such as promotional initiatives. We’ve enjoyed great success with sharing stationery, printers, secretarial support and we’ve even produced co-branded press releases with complementary businesses, sharing knowledge and the results of surveys, etc.
It’s a competitive job market out there. As a business owner, you can use this to your advantage by welcoming smart students and recent graduates into your fledgling empire. It costs a little, and the benefits are tremendous. Many organisations can help you find talented and ambitious candidates who can give your business extra bandwidth.
From past experience, I’d recommend being as specific as possible when writing out a person/job specification. Define the role as clearly as possible and take the time to train your ambitious upstart properly. Pay your interns well, it improves the experience for all parties and creates confidence in the relationship.
Leverage as much as possible from your first 100 customers. It’ll prevent spending a lot of money on hit and miss advertising. We were a firm believer in making all our early adopters feel a part of our journey. The benefits are endless: word-of-mouth referrals, feedback on product and creating a loyal army of brand advocates.
Likewise, always try to share value and knowledge where possible. Start a blog, dive into relevant social media conversations, contribute to other like-minded websites and become a thought leader in your industry. These are low-cost routes to building buzz and attention for your business.
Whether you need stationery, office space, foreign exchange or help with your website or marketing, run a competitive process and seek at least three bids. Not only will you get better product, but you’ll also make significant savings. Always distinguish between purchases that are nice to have versus those you must have.
Many businesses lose lots of money each year unnecessarily when making international money transfers to overseas costumers or suppliers. When paying overseas suppliers, beware of the “we offer 0% commission” marketing gimmick. There is rarely a ‘free money transfer’ offer out there. The devil is in the detail and most banks and currency brokers make money by applying high profit margins to the rate of exchange. Always remember: the difference between a good and bad money transfer deal will be within the rate of exchange. Try to obtain multiple quotes on every transfer. It pays to shop around.
Copyright © 2014 Daniel Abrahams. Daniel is CEO of CurrencyTransfer.com (“the world’s first international payment marketplace”).
Many new businesses use Excel spreadsheets to keep financial records when they start up. And while the familiarity, ease of use and affordability of this is understandable, as small businesses grow, by launching new products, opening at other locations or otherwise expanding their geographical reach, their accounting function must become much more complex.
Using disparate solutions across different sites can make consolidating annual accounts a challenging process. Likewise, for businesses that export overseas or import, multi-currency invoicing and transactions adds another layer of complexity.
To help them grow, businesses need accounting functions that can deal with growth. Additionally, the ability to create additional reports that provide up-to-date financials and that integrate with other internal systems and software is vital.
Fortunately, cloud-based (ie online) accounting systems can help businesses to overcome the constraints of spreadsheets, to become proactive rather than reactive and ponderous. And such systems can be very easy to implement.
The cloud allows SMEs to become more efficient. The most effective cloud-based solutions automate processes, remove time-intensive and unnecessary data duplication and close the gap between input and output. Reports comparing “actuals” (ie actual earnings and expenses rather than projections), budgets and forecasts can be created in minutes and accessed anytime, anywhere by various staff members.
Security and regulation can be more easily managed using cloud-based systems and the chances of human error become less likely. Technology will undoubtedly continue to be one of the key growth drivers for SMEs in the next decade. Therefore perhaps it’s time for businesses to move on from spreadsheets to realise the potential offered by cloud-based accounting solutions.
Barbara is managing director of online accounting provider Twinfield, part of the Wolters Kluwer tax and accounting division.
Copyright © 2014 Wolters Kluwer (UK) Limited
When we started out four years ago, leading a team wasn’t a consideration. We were a small family unit and did everything ourselves. We dreamt big but back then we couldn’t have known how things would evolve.
As our company grew, it became apparent that we had to employ staff. This was uncharted territory; now we had to become managers and leaders if we wanted to grow. Our skills had been more than adequate up to this point but we now needed an upgrade. I suspect many small firms find themselves in the same situation, when it’s crucial to embrace the next step – it’s make or break.
If you’re happy to stay small and have no real interest in growing – that’s fine. But if you want to get to the next level you must learn how to delegate and manage people. We decided it would be a good idea to hire a business coach. There’s no shame in admitting you don’t know it all and we felt some guidance would surely benefit our business. Here are some points worth considering:
Copyright © 2014 Sam Frith. Sam Frith is the creative director of Ski Boutique, an “international agency offering luxurious and bespoke holidays in Europe’s most breathtaking alpine destinations”.
By setting a timetable for your working week. It doesn’t have to be the same routine every week, but plan the following week’s schedule so that personal and business commitments are separated and you allow sufficient, uninterrupted working hours each day. This ensures that when meetings are arranged, professionally or socially, you won’t let anyone down. More importantly, it also means that you can relax, knowing you have an effective schedule, can take proper breaks and end your working day at a reasonable time. If you live with a partner or family scheduling is particularly important if you are to maintain a balance between your personal and work lives.
Working from home often means having to consider others, but your schedule won’t remain intact if you have kids demanding your attention or housemates bringing home friends and walking into your workspace. If possible, your workspace should be in a quiet part of the house. A sign on the door letting people know if you can be interrupted is also useful. At the very least have somewhere to shut away your work things at the end of the day. Packing up is an excellent way of signalling to yourself and others that your working day is over.
Building meetings outside of your home into your working week means you actually get out and speak to people. It also means that you are engaged in building your professional network and promoting your business. A great way to do this is to use a co-working space. These are open-plan, shared workspaces where you can hire a desk by the day or half day. They often have social cafeterias and business events that you can attend to learn new things and make new connections.
This might sound obvious, but you have to really love something about your business if you are to get through more demanding days. Whether it’s being your own boss, loving what you make or the service you deliver, or simply engaging with people to promote and sell your product or service. The more you like something the better you tend to be at it. And it makes the things you don’t like easier to tolerate.
It’s tempting to have every work-related email and social network app notification pinging just in case you miss something really important, but whether you’re in working hours or not, this can be incredibly distracting, diverting your attention away from your well-planned day or critical objectives. If your business does not need you to be available 24/7, turn off the automatic notifications on your devices out of working hours.
A good mentor can help you succeed. They’re usually someone who has been in business, having started from exactly your position; someone who has overcome similar challenges. They may have specialist knowledge or networks you can tap into and will ask you questions to test your thinking. It’s good to be challenged in this way. A good mentor will help you see things from an external, impartial perspective, which can be incredibly valuable when you’re working from home, mostly by yourself. Equally important, a good business mentor also brings compassion and empathy and cares about your long-term success.
Copyright © 2014 Zoe Brown. Zoe Brown is a business manager at Bright Ideas Trust, a charity that helps young people in London who aren’t in employment, education or training or “who haven’t had the same chances as the rest of society to start their own companies and learn business skills that will stay with them for life”.
Would you like your business to reach £1m turnover? Most business owners would answer yes, but 96% of them will fail. Only 4% of businesses reach £1m turnover.
Why so few? Well, it has a lot to do with how you started the business and what pillars you have in place to allow you to reach that level.
Having worked with hundreds of businesses over the past few years, I have discovered that there are some striking differences between the ‘micro’ business owner and the owner of a £1m enterprise:
Starting a business requires no formal education or qualification. The process of going online and registering a new company is easy.
This ‘low bar’ to start also means that most people assume that what they know is likely to be enough. They then spend the entire first year bravely finding their footing and ‘learning to walk’.
The skills they develop at this early stage will influence their ability to break through the £1m mark later on.
Most businesses hit a ceiling because the way they began means further improvement and growth is too complex for them to handle and pursue.
Effectively, the business becomes trapped in what is sometimes called the ‘Hindu Rate of Growth’ – an average growth rate of around 3% each year – just enough to keep pace with inflation.
To break through this ceiling, new systems need to be employed to allow for growth to happen, while at the same time managing the increasing complexity of the business. What allowed many entrepreneurs to run a successful small business simply cannot support larger, more complex teams and issues.
It is at times like this that it helps to have an outside party shine fresh light on your business processes.
Every entrepreneur – ideally at the start-up stage – needs to become fluent in the language of business. This language is all about numbers; profit, sales, cashflow, receivables, assets, equity, ROI, average value sale, conversion rate – these are all numbers that the professional business person not just understands, but is also able to leverage for every business decision they make.
In marketing, sales, team management and leadership there are key metrics to measure, estimate and average to evaluate and justify decisions that will lead to sustainable growth.
If you want your business to break through the £1m threshold, review your techniques and decision-making processes now. Don’t wait until you hit the ceiling and get stuck.